Procedure for recovery of expenses made by TROs in realising arrears of revenue as per Rule 5b of 2nd Schedule. - Income Tax - 1332/CBDT

INSTRUCTION NO. 1332/CBDT Dated: May 2, 1980 The revenue Audit has brought to the notice of the board certain cases where Tax Recovery Inspectors had incurred expenditure on carriage of goods, hamali charges thela charges, cost of drum beating etc. from out of their pockets and got these expenses reimbursed to themselves out of the recoveries effected from the defaulters by attachment and sale of movable/immovable properties. The AG's objection to such appropriation was that the same was opposed to rule 7 of the Central Treasury rules. 2. The matter was examined in the board in consultation with the Ministry of law C AG and chief controller of accounts. It is obvious that practice of drawing on private resources to meet such recurring expenditure on government account and not accounting for the receipt and disposal of a part of the sale proceeds received on government account cannot be given any official recognition. The need for cash to incur anticipated expenditure arises in other areas of official activity also and is met under the existing procedure by drawing from the imprest amount or drawing from the treasury by submitting a bill estimated expenditure on account of charges to be incurred by the department in recovery proceedings should be anticipated and provided for in the budget grant of the office concerned to enable the drawl of the money as and when required. 3. Rules 5'b of the 2nd schedule authorises the recovery of all charges in respect of proceedings taken for realising the arrears from the defaulter. Rule 8'1'a' of the 2nd schedule directs that whenever assets are realised in execution of a certificate the costs incurred by the ITO shall be paid to him. 4. It has therefore been decided that the TROs should be instructed to- i) draw from contingencies to meet expenses in connection with recovery and ii) credit amount recovered from the defaulter towards such charges to government account under the major head concerned under the minor/ detailed head other receipts /other items. 5. If any TRO needs an increase in his imprest account, necessary proposals making out a case for such increase should be submitted by him to his Accounts officer with data relating to actual expenditure on this account in the past to enable the accounts officer to consider the request for such increase. 6. These instructions may be brought to the notice of all TROs they should be strictly advised that expenditure should not be incurred out of pocket without their being brought into account and there should be no appropriation of the sale proceeds with out their passing through account.